Feb. 25 (Bloomberg) -- Morgan Stanley agreed to pay the
U.S. Securities and Exchange Commission $275 million to resolve
a probe into the sale of subprime mortgage-backed securities in
2007.

The SEC hasn’t presented the proposed settlement to the
commission and offered no assurance it will be accepted, the New
York-based bank said today in an annual regulatory filing. The
firm said it’s also responding to subpoenas and requests for
information from federal and state regulators in mortgage-related matters.

Morgan Stanley listed nine legal matters it resolved or
settled since October, including agreements with MetLife Inc.
and Cambridge Place Investment Management Inc., as the largest
U.S. banks seek to put crisis-era lawsuits behind them. The firm
said its litigation costs more than tripled to $1.95 billion in
2013 from $513 million in 2012.

“The company expects future litigation expenses in general
to continue to be elevated, and the changes in expenses from
period to period may fluctuate significantly, given the current
environment regarding financial crisis-related government
investigations and private litigation affecting global financial
services firms,” the bank said in the filing.

Morgan Stanley agreed this month to pay $1.25 billion to
settle a U.S. regulator’s claims the investment bank sold faulty
mortgage-backed securities to Fannie Mae and Freddie Mac. Morgan
Stanley took a $150 million charge to its fourth-quarter
results, after saying last month it added $1.2 billion to legal
reserves in the period related to mortgage-backed securities
litigation and investigations.

Due Diligence

The bank said today it is responding to subpoenas and
requests for information from members of the RMBS Working Group
of the Financial Fraud Enforcement Task Force.

“These matters include, but are not limited to,
investigations related to the company’s due diligence on the
loans that it purchased for securitization, the company’s
communications with ratings agencies, the company’s disclosures
to investors, and the company’s handling of servicing and
foreclosure related issues,” the firm said.